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European Central Banks Face Added Political Constraints

The banks’ own rules, along with wider political trends and mixed economic signals complicate any move to tighten policy

By

Simon Nixon

July 2, 2017 12:11 p.m. ET

Central bankers around the world are grappling with a common problem: when and how to normalize monetary policy at a time of normal levels of economic growth, normal levels of unemployment but abnormal levels of wage growth that is keeping inflation lower than their economic models predict.